energy outlook

MAJOR HIGHLIGHTS

NYMEX January Crude Oil futures ended the week 25.02% lower than the previous week.

The U.S. Labor Department reported that nonfarm payrolls plunged by 533,000 in November, the worst job loss in 34 years and much bigger than the projected loss of 350,000.

The Labor Department also reported that the unemployment rate rose to 6.7% in November, the highest jobless rate since October 1993.

MARKET RECAP

Crude Oil futures ended down for the sixth straight session on Friday, marking lowest settlement price in 4 years, after a US government report showed that US employers cut jobs in November at the fastest pace since 1974. NYMEX January Crude Oil futures were down by 6.54% to close at $40.81 a barrel, the lowest closing level since 13th December 2004.

Oil prices were trading on negative note in the last week, as bleak economic data from US and Europe indicated that recession in these countries could deepen further and affect energy demand negatively. Relatively firm dollar against major currencies also weighed on oil prices.

New York Mercantile Exchange Natural Gas futures traded lower on Friday, as fall in oil prices pulled gas prices lower. January Natural Gas futures were down by 4.67% to close at $5.767.

OUTLOOK

After oil prices have fallen by more than 70%, OPEC president has said in his interview that cartel will need to cut production significantly to support prices during its meet on 17th December. Oil prices are likely to rise in the near term after witnessing sharp fall on account of technical buying, but underlying fundamentals are still bearish. Crude Oil prices have fallen sharply amidst growing concern over global recession and falling oil demand. Energy Markets are increasingly concerned, that the worldwide economic decline is too pronounced to be fixed any time soon and a worldwide recession will curtail energy demand. In the current environment of a firm dollar and deteriorating economic outlook, the short-term price risk remains skewed to the downside.

NYMEX Crude Oil prices are trading at multi year low levels. The overall trend still continues to remain down as prices are still closing below its short-term 9-Day Moving Average. We can witness some consolidation in crude prices with crucial resistance seen at $44.10/$46.20 level & support at $41.50/$39.90 levels.

Natural Gas prices are expected to trade on negative note, as weak oil prices and sluggish demand during winter season is weighing on prices. MCX Dec contract has support at 266.50 levels & resistance at 285.60 levels.


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base metals outlook

MARKET RECAP

Base metals struggled around their fresh multi-year lows on Friday as the complex remained gripped by depressed sentiment and fears of a deep global recession. A host of negative data from the US also added pressure on base metal prices. Base metals saw new lows on Friday as concerns over economic growth coupled with technical selling hit prices the hardest. Even LME inventory data was bearish for all metals except Nickel.

Copper prices declined below their strong support of $3,100 and touched a low of $2,990 on Friday. Continuous rise in LME inventories coupled with weak economic data pulled the red metal sharply lower. However, copper managed to close above $3,060 on Friday. Aluminum prices fell under $1,500 as prices felt the pressure of declining crude oil prices and weak economic situation. Overall the complex declined sharply on Friday as the release of US economic data raised concerns of the global recession that we are currently facing.

On the macroeconomic front, the US Labour Department announced that non-farm payrolls for the month of November stood at 533,000, its weakest performance in 34 years. This shows that the recession affected the jobs market to such a large extent. Another negative data was the release of US consumer credit that declined by $3.5bn or 1.6% at an annual rate.

OUTLOOK

The overall financial market scenario is weak and this has hurt trading sentiments across the globe. Hence, the trend in base metals remains down. Base metals may have witnessed few short-covering rallies in the past month but metals could not sustain at those levels as profit-booking emerged. Since markets are in a bearish phase technical selling cannot be ruled out. Along with that, a major rise in inventories has also put pressure on prices.

Copper prices dipped below their marginal cost of production of $3,100 and this indicates that markets are concerned over demand of the metal in times of a global recession. Aluminum price continue to face the threat of a fall in crude oil prices. Overall situation of rising inventories is also acting as a bearish factor. We expect base metals to remain volatile throughout this week.

On the macroeconomic front, weak economic performance across the globe is affecting trading sentiments. Financial markets are feeling the pain of the long and deep economic recession which is expected to continue through the next year.

Copper

Copper prices have been trading range bound for past few trading sessions with immediate support seen at Rs.163.10 levels for MCX Feb contract. Further below, support is seen at 159.40 levels.

Whereas resistance is seen at Rs.171.10 levels & further upwards at Rs. 176.80.

Zinc

Immediate support is seen at Rs.53.70 levels for MCX December contract whereas crucial support is seen at Rs.52.20 levels.

Short-term resistance is seen at Rs.56.50 whereas major resistance is seen at Rs 58.65.


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gold outlook

MAJOR HIGHLIGHTS

Gold assets held in exchange-traded funds managed by ETF Securities Ltd. rose to 1.708 million ounces, from 1.615 million on Dec. 2, the Jersey, Channel Islands-based company said yesterday.

The US Federal Reserve meets on Dec. 16 to decide on further rate cut the world’s largest economy in recession.

MARKET RECAP

Last week, Spot gold fell sharply losing almost $63 over the week as selling pressure was witnessed at higher levels. The dollar continued to strengthen during the week whereas crude prices continued to make multi-year lows, both leading to a sell-off in bullion prices. Also, with the global equities markets still suffering from bearish sentiments and negative news, sell-off across various asset classes can still be seen across the world. Last week, the Bank of England (BOE) dropped its key lending rate by a full percentage point to 2%, the lowest level for the benchmark since 1939. The European Central Bank (ECB) also slashed its key lending rate by three-quarters of a percentage point to 2.5%. The cut is the largest in the ECB's 10-year history.

In currency market, the Euro trading sideways for the week with short-term support level of 1.2540 whereas resistance is seen at 1.2870. The overall trend still remains sideways-down unless we see a close above 1.2842 and consistent trading above the same. The low of 1.2328 made on 28th October shall continue to act as a very strong support.

OUTLOOK

The overall trend remains down for Gold as the $ is still going strong. Also, inflationary pressures have eased considerably with the sharp fall in crude prices. While the dollar has been the beneficiary of bigger-than-expected rate cuts in Europe, last week’s U.S. jobs data (Nonfarm Payrolls) could pressurize the dollar with the focus now shifting back toward the U.S. economic numbers. Also, a 50 basis point rate cut by the US Fed is currently being expected by market participants in the next week.

Deflation continues to be the key macro development to watch, as gold’s attraction has been waning. The movement in gold prices is presently being driven primarily by the Dollar direction. The Dollar Index has resistance at 87.40 & support at 85.60 for the day. Currency & crude shall continue to play an important role in impacting bullion prices in coming days.

On intraday basis, Spot Gold prices have immediate support at $772/$782 whereas resistance is seen at $760/$752. Spot Silver prices shall find support at $9.58/$9.30 whereas resistance is seen at $9.80/$10.00.

MCX Feb Gold has support at 12100/11950 whereas resistance is seen at 12260/12390 levels whereas MCX March Silver shall find support at 16550/16270 whereas resistance is seen at 16820/16980 levels.


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safe trade calls

GOLD

Continue to view, as long Resist 12400 down trend likely to continue, book profit on sell below 12300, for the day sell only below 12050 S/L 12090 and T/p 12000-11980/11950/towards 11800 in coming days OR sell ard 12340-350 S/L 12360 and T/p 12300-250 (any time close above 12400/12950/13175-13250/ 13650/14400 bullish while close below 11950/11525-420 bearish for medium term)


SILVER

Continue to view as long Resistance 16700 & 17000 down trend likely to continue. for the day sell only below 16300 S/L 16400 and T/p 16200-100/ sustain close below test 16000-15800 in coming days OR sell ard 16820-830 S/L 16850 and T/p 16750-675, only sustain abv 16875 & 17000 avoid short sell (any time close below 16100/15775 bearish rally while close above 17600/18300/ 19475/20975/21725 bullish for medium term)


CRUDE

THIS WAS OUR VIEW ON 29-11-2008 REPORT "as long Resistance 2775, down trend likely to continue" AND PRICE TURN FROM HIGH 2766 THAT DAY AND MAKE LOW=2050 FRIDAY. Continue to view, as long Resistance 2240, down trend likely to continue. book profit on sell below 2690/2550/ 2420/2350/2200, for the day sell only below 2050 S/L 2065 and T/p 2030-2000 OR sell ard 2158-65 S/L 2170 and T/p 2135-2110 (now crude need to close above 2240/2555/2775/2970/3040/ 3200/3525/ 3790/4170/4380/4980 for bullish rally while close below 2050
bearish for medium term)


COPPER

Continue to view, as long Resistance of 170 down trend likely to continue. book profit on sell below 186.5/182.5/176.5-175.5/169.5, for the day sell only below 161 S/L 162.5 and T/p 159.5-159/157 OR sell ard 167.2-167.5 S/L 168 and T/p 166-165 (upside strong rally only on close above 170/183.5/191.5/197.5/ 204.5/219/238/271 while close below 159.5 bearish for medium term)


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nymex crude outlook

U.S. crude futures fell below $51 yesterday and settled lower as demand worries after a government report showed the U.S. economy shrank more severely during the third quarter than initially estimated.

According to the U.S. Commerce Department, real GDP decreased at an annual rate of -.5% in the third quarter, down from the previous estimate of -.3%, as expected.

But on Monday crude oil closed in the green in line with the stock rally .Stocks rallied after the announcement of U.S governments rescue package for Citigroup .U.S. government agreed to inject $20 billion of new capital to rescue troubled Citigroup yesterday. Investors remain cautious due to concerns about a global recession; they welcomed the U.S. government's $300 billion-plus lifeline to prevent the collapse of the world's largest banking group

According to the International Energy Agency, the Oil prices will remain under downward pressure in 2009 as the weak global economy hits demand. And also a report says that the oil companies are booking tankers to store millions of barrels of crude oil at sea, waiting for demand and prices to rise.

All the oil traders are keeping their eyes to the OPEC meeting that will be held on Nov. 29 in Egypt and again on Dec. 17 in Algeria.

According to a monthly report from the American Petroleum Institutions the oil demand had dropped 5% from January through October -- marking their largest decline since the early 1980s,
As crude-oil prices has drooped more than 63% from their record high as the credit crunch deepened. Oil price had touched an all-time high of $147.27 a barrel on 11th July but has corrected from there in the succeeding weeks.
Light, sweet crude oil for December delivery in the New York Mercantile Exchange traded in the range $54.66-$50.52, and settled at $50.65 a barrel yesterday.

Weekly Crude Oil (DWTI dec.)

Weak movements expected below $48.20, otherwise expecting some recovery .Resistances are $51 $54.30, $58.80, Supports seen at $44.80, $40.20, and$ 35.

DWTI (DEC) traded in the range $53.85 - $50.60 and closed at $50.77

TECHNICAL OUTLOOK (Intra-day)
DGCX Crude (DEC) - Bullish above $51.20 bearish below $50.40


MCXARUN
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future gold outlook

U.S. gold futures declined from 6 weeks high and closed slightly lower as oil tumbled in the international market.

U.S. crude oil futures settled lower yesterday as demand worries after a government report showed the U.S. economy shrank more severely during the third quarter than initially estimated.

According to the U.S. Commerce Department, real GDP decreased at an annual rate of -.5% in the third quarter, down from the previous estimate of -.3%, as expected.

But the dollar continued its weakness against the major currencies yesterday as the expectation of diminished demand in dollar as safe heaven. New U.S. measures to boost consumer lending helped ease concerns about the financial crisis, and changed the view in dollar. The US GDP also influences the dollar movements.

According to the World Gold Council, Global demand for gold jumped 18 percent year-over-year to 1,133.4 tonnes in the third quarter, reversing a weaker trend earlier this year, because of strong buying by investors and a lower gold price.
International spot gold traded in the range $ 830.1– $ 801.80 a Troy Ounce and last quoted at $820.70

Weekly Outlook (DG. OCT.)

Continuation of the bullish movements expected above $816.Resistances are $829 $849, $869,913 Supports seen at $802, $771, $754.

Last day DGCX Gold FEB. Traded in the range $832.2-803 and closed at $ 816

TECHNICAL OUTLOOK (Intra-day)

GOLD (FEB) - Bullish above $ 819.50 bearish below $814


MCXARUN
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safe trade calls

GOLD

PRICE TURN EXACT FROM OUR GIVEN LEVEL ON BOTH SIDES AS SUPPORT GIVEN=12920 & LOW= 12928 WHILE RESISTANCE GIVEN= 13250 AND TURN FROM HIGH=13234. Continue to view, as long Resist 13250 correction expected towards 12700/ 12450 in coming days. for the day sell only below 12920 S/L 12970 and T/p 12800-725/sustain below down rally sharp OR sell ard 13235-240 S/L 13250 and T/p 13160-13100, sustain abv 13250 avoid short sell (any time close above 13250/13600/14325 bullish while close below 12700/12075/11450/11290-250 bearish for medium term)


SILVER


PRICE TURN ALMOST FROM OUR GIVEN RESISTANCE=17600 AS DAYS HIGH=17585. for the day sell only below 17000 S/L 17080 and T/p 16940-16800/below down rally OR buy only abv 17500 S/L 17425 and T/p 17600/ 17750/sustain close above 17750 test 18500 atleast in coming days (any time close below 16350/15775 bearish rally while close above 17750/19000/20550/ 21400/22150/25250/26350/27475/ 28000 bullish for medium term)


CRUDE


Continue to view, as long Resistance 2725/2775, down trend likely to continue. book profit on buy ard 2770-72, for the day sell below 2550 S/L 2570 and T/p 2530-2500/sustain close below test 2375 in coming days OR sell ard 2655-60 S/L 2665 and T/p 2635-20 (now crude need to close above 2775/2970/ 3040/3200/3525/3790/4170/4380/4980 for bullish rally while close below 2500 bearish for medium term)


COPPER

As long Resistance 189.5-190 down trend likely to continue. for the day sell only below 178.5 S/L 180 and T/p 176/ 173.5-172.5/sustain below test 165 atleast in coming days OR sell ard 186.8-187 S/L 187.5 and T/p 185-183.5 (upside strong rally only on close above 190/199/215/234.5/248/270/305/316/ 327/339/351.25/360.5/387/398 while close below 172.5 bearish for medium term)


MCXARUN
9994500540